"Think twice."

Why was it invented?
Since its inception, the bankruptcy code was designed for one
purpose. to help relieve Americans from the shackles of
endless and unmanageable debts. Before the bankruptcy code
came about, people went to debtor's prison. We all know we
can't pay many bills while in jail. So the law was written to give
people a way out with a fresh start.

The Price you pay.
Aside from the attorney fees of up to $1500.00, and
appearances in court, bankruptcy is not a pleasant experience.
The filing becomes a matter of public record and the mark stays
on your credit file for 10 years. The mark proclaims to the world,
"I had to rely on the court's protection from my creditors. I was
unable or unwilling to find another solution." This is why lenders
are concerned when they see this notation. It makes borrowing
in the future a bigger challenge and rates are higher for as long as
they hold it against you.

When bankruptcy makes sense.
When you have exhausted every avenue possible, and you
simply cannot make your payments, it may be time to consider
the protection from the court. The filing of a bankruptcy will stop
a foreclosure in its tracks. The mortgage company must cease all
collection and legal activity by law. In a chapter 13, a trustee is
appointed who will disburse funds from your pay to go to all of
your creditors in a plan that you can afford. You will pay your
mortgage payment each month as you did before you ran into
trouble, with no increase to the payment. The pay plan will
continue for 3 to 5 years depending on the amounts behind.

HomeSavers USA, Inc., is not a law firm. We do not give legal advice.  These guidelines are not to be construed as legal advice or the practicing of law.